Nvidia Acquires Groq for $20 Billion in AI Accelerator Chip Deal
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
0mins
Source: CNBC
- Record Acquisition: Nvidia's acquisition of high-performance AI accelerator chip designer Groq for $20 billion in cash marks the company's largest deal to date, underscoring its aggressive expansion strategy in the AI sector.
- Swift Deal Closure: Groq, which raised $750 million at a $6.9 billion valuation just three months ago, was not actively seeking a sale, yet Nvidia's interest quickly led to the transaction, reflecting the strong market demand for AI accelerator chips.
- Robust Cash Reserves: As of the end of October, Nvidia reported $60.6 billion in cash and short-term investments, a significant increase from $13.3 billion at the beginning of 2023, providing ample financial resources for large-scale acquisitions and reinforcing its market leadership.
- Significant Industry Impact: With Groq targeting $500 million in revenue this year amid surging demand for AI accelerator chips, Nvidia's acquisition is set to enhance its competitive edge in AI technology and boost its capabilities in inference tasks for large language models.
NVDA
$190.95+Infinity%1D
Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for NVDA is 255.63 USD with a low forecast of 185.00 USD and a high forecast of 352.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
40 Analyst Rating
38 Buy
1 Hold
1 Sell
Strong Buy
Current: 188.610
Low
185.00
Averages
255.63
High
352.00
Current: 188.610
Low
185.00
Averages
255.63
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
